Hey there, time traveller!
This article was published 31/10/2013 (1061 days ago), so information in it may no longer be current.
Two former clients of Great-West Life who were bilked out of more than $600,000 in retirement savings by a company agent have put Manitoba's biggest company in their crosshairs.
Michel and Lorraine Mignault were among the clients of disgraced financial planner Gary Palmer, a former agent with the Winnipeg-based financial services giant. Palmer was convicted of defrauding 23 clients, including the theft of $1.5 million during a 10-year-period from 1997 to 2006.
Instead of investing the funds, Palmer spent his clients' money for his own personal use and lifestyle.
He was sentenced to eight years in prison in November 2010.
Now the Mignaults are suing Great-West Life in civil court, claiming the 17th biggest company in Canada by market capitalization -- with assets under management of more than $595 billion, according to its latest quarterly report -- is "vicariously liable" for the fraud perpetrated by Palmer. The Mignaults are asking for the $665,000 they lost plus $500,000 in punitive damages.
Great-West Life claims it isn't responsible for Palmer's actions.
"All of the agents and brokers with whom Great-West Life has contractual arrangements are independent contractors who carry on their own financial planning or investment business under their own business name. For example, in this case, Mr. Palmer carried on business under the name of 'Palmer Financial,' " Great-West Life lawyer Beth Eva said in her opening statement.
In court documents, Great-West Life also denies Palmer acted with any authority from it when he gave advice and instructions to the plaintiffs.
"... if Palmer was an agent of Great-West Life for any material purpose, which is denied, he was not acting within the scope of any express, implied, apparent or ostensible authority from Great-West when he performed the acts or committed the breaches of duty and/or misappropriation alleged in the statement of claim."
In court, lawyer Dave Hill, who represents the Mignaults, disputed Great-West's claim, noting Palmer communicated on company letterhead.
"This constitutes an amazing lack of corporate morality, good faith and responsibility towards the customers who, by and large, can only buy Great-West Life products through these sales reps, whether called internally an agent or a broker. Coming from Winnipeg's corporate jewel, that position is incredulous," Hill said.
"Why would Winnipeg's corporate jewel not just take responsibility for Palmer's actions in defrauding at least 23 clients, and sit down with plaintiffs and replace their RRSP funds in the investments in which they were supposed to be in Great-West Life?"
A spokesman said Great-West Life does not comment on matters before the courts.